CGU LOGISTICS LTD, MUMBAI V. DCIT 5(1)(2), MUMBAI

ITA 1059/MUM/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8017 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 15-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AWUNGSHI GIMSON
• Keywords: Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER ITA NO. 1059 / MUM . /2017 ( ASSESSMENT YEAR : 2013 14 ) CGU LOGISTICS LTD. 106, HALLMARK BUSINESS PLAZA SANT DYANESHWAR MARG, BANDRA (EAST) MUMBAI 400 051 PAN AACCC8880B . APPELLANT V/S DY. COMMISSIONER OF INCOME TAX (I.T) CIRCLE 5 ( 1 )( 2 ), MUMBAI . RESPONDENT ASSESSEE BY : SHRI NISHANT THAKKAR REVENUE BY : SHRI AWUNGSHI GIMSON DATE OF HEARING 09 .0 4 .201 9 DATE OF ORDER 15. 0 4.2019 O R D E R PER SAKTIJIT DEY. J.M. THE AFORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 23 RD NOVEMBER 2016, PASSED BY THE LEARNED COMMISSIONER (APPEALS) 10, MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 2013 14. 2 . THE DISPUTE IN THE PRESENT APPEAL IS CONFINED TO THE ADDITION OF ` 10,60,01,838, ON ACCOUNT OF DISCREPANCY BETWEEN THE INCOME SHOWN BY THE ASSESSEE AND AS APPEARING IN FORM NO.26AS. 2 CGU LOGISTICS LTD. 3 . BRIEF FACTS ARE, THE ASSESSEE COMPANY FILED ITS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR ON 23 RD NOVEMBER 2013, DECLARING LOSS OF ` 34,31,31,098. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OF FICER ON THE BASIS OF INFORMATION CONTAINED IN ANNUAL INFORMATION REPORT (AIR) FOUND THAT AS PER FORM NO.26AS UPLOADED TO THE SYSTEM , INCOME RECEIVED BY THE ASSESSEE DURING THE RELEVANT YEAR WAS ` 13,62,41,552. WHEREAS, IN THE PROFIT & LOSS ACCOUNT THE ASS ESSEE HAD CREDITED INCOME OF ` 2,87,33,325. THEREFORE, THE ASSESSING OFFICER CALLED UPON THE ASSESSEE TO EXPLAIN THE DIFFERENCE IN INCOME. IN RESPONSE, IT WAS SUBMITTED BY THE ASSESSEE THAT THE INCOME SHOWN IN FORM NO.26AS, IS INCORRECT AND ERRONEOUS. HOWE VER, THE ASSESSING OFFICER DISBELIEVING THE CLAIM OF THE ASSESSEE ADDED BACK THE DIFFERENTIAL AMOUNT OF ` 10,75,08,227, AT THE HANDS OF THE ASSESSEE AND AFTER ADJUSTING THE LOSS SHOWN , HE DETERMINED THE INCOME OF THE ASSESSEE AT ` 1,31,77,350. THE ASSESSEE CHALLENGED THE AFORESAID ADDITION BEFORE LEARNED COMMISSIONER (APPEALS). FROM THE MATERIAL SUBMITTED BEFORE THE LEARNED COMMISSIONER (APPEALS), HE FOUND THAT THE DIFFERENCE IN INCOME AS SHOWN BY THE ASSESS EE AND AS APPEARING IN FORM NO.2 6AS IS DUE TO THE FOLLOWING INCOME: INTEREST ` 15,06,390 CONTRACT AMOUNT RECEIVED FROM SOCIEDADE ` 6,73,58,662 CONTRACT AMOUNT OF PRIMA MINERALS ` 3,16,97,190 TOTAL: ` 10,05,62,242 3 CGU LOGISTICS LTD. 4 . L EARNED COMMISSIONER (APPEALS) AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE IN THE CONTEXT OF FACTS AND MATERIAL ON RECORD INCLUDING THE ORIGINAL 26AS, FOUND THAT THE INTEREST INCOME OF ` 15,06,390, WAS ALREADY OFFERED FOR TAXATION IN THE PROFIT & LOSS ACCOUNT ITSELF AS BUSINESS INCOME. THEREFORE, HE OBSERVED THAT THE INTEREST INCOME CANNOT BE AGAIN ADDED UNDER THE HEAD INCOME FROM OTHER SOURCES. HOWEVER, HE OBSERVED THAT WHILE ADOPTING THE RECEIPTS AS PER 26AS, WHICH INCLUDES THE INTEREST INCOME O F ` 15,06,390, THE ASSESSING OFFICER MADE AN ERROR BY REDUCING THE INTEREST INCOME FROM THE RECEIPTS SHOWN BY THE ASSESSEE IN THE PROFIT & LOSS ACCOUNT. THEREFORE, AFTER CONSIDERING THE FACTS AND MATERIAL ON RECORD , INCLUDING ORIGINAL 26AS, LEARNED COMMISS IONER (APPEALS) COMPUTED THE ADDITION TO BE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DIFFERENCE OF RECEIPT AS PER PROFIT & LOSS ACCOUNT AND FORM NO.26AS, AS UNDER: INTEREST INCOME ` 15,06,390 CONTRACT AMOUNT RECEIVED FROM SOCIEDADE ` 12,40,71,982 CONTRACT AMOUNT OF PRIMA MINERALS ` 1,06,63,181 SUB TOTAL: ` 13,62,41,553 LESS: RECEIPT AS PER PROFIT & LOSS ACCOUNT ( ) ` 3,02,39,715 ADDITION ON ACCOUNT OF DIFFERENCE ` 10,60,01,838 5. L EARNED AUTHORISED REPRESENTATIVE SUBMITTED , THE ASSESSEE HAS NO DISPUTE WITH REGARD TO THE INTEREST INCOME OF ` 15,06,390. FURTHER, HE SUBMITTED , ON INSTRUCTIONS OF THE ASSESSEE, HE DOES NOT WANT TO 4 CGU LOGISTICS LTD. CONTEST THE ADDITION OF ` 1,06,63,181, BEING THE CONTRACT AMOUNT RECEIVED FROM PRIME MINERALS. THERE FORE, THE ONLY ADDITION WHICH SURVIVES FOR OUR CONSIDERATION IS THE AMOUNT OF ` 12,40,71,982, BEING CONTRACT RECEIPTS FROM SOCIEDADE. THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THE SAID PARTY HAS WRONGLY SHOWN THE RECEIPT OF ` 12,40,71,982 TO THE ASS ESSEE WHICH WAS UPLOADED IN THE OLD 26AS. HE SUBMITTED , SUBSEQUENTLY, THE MISTAKE WAS RECTIFIED BY SOCIADADE SHOWING THE ACTUAL AMOUNT PAID TO THE ASSESSEE AT ` 5,67,13,320, AND IN NEW FO RM NO.26AS UPLOADED TO THE SYSTEM. IN THIS CONTEXT, HE DREW OUR ATTENTION TO THE CONTRACT AMOUNT PAID BY THE SAID PARTY TO THE ASSESSEE AS SHOWN IN OLD AND NEW FORM NO.26AS. THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THOUGH THE NEW FORM NO.26AS WAS FURNISHED B EFORE THE LEARNED COMMISSIONER (APPEALS), HE HAS COMPLETELY IGNORED T HE PAYMENT SHOWN IN THE REVISED/ NEW FORM NO.26AS. THUS, HE SUBMITTED , THE AMOUNT OF ADDITION ON ACCOUNT OF CONTRACT RECEIPTS FROM SOCIEDADE SHOULD BE RESTRICTED TO ` 5,67,13,320. 5 . THE LEA RNED DEPARTMENTAL REPRESENTATIVE , THOUGH , REL IED UPON THE OBSERVATIONS OF LEARNED COMMISSIONER (APPEALS), HOWEVER, HE SUBMITTED THAT A DIRECTION MAY BE GIVEN TO THE ASSESSING OFFICER TO VERIFY ASSESSEES CLAIM AS PER NEW FORM NO.26AS. 5 CGU LOGISTICS LTD. 6 . WE HAVE CONSIDERED R IVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. NO DOUBT, IN THE OLD FORM NO.26AS THE CONTRACT RECEIPT FROM SOCIEDADE HAS BEEN SHOWN AT ` 12,40, 71,982. HOWEVER, IN THE REVISED/ NEW FORM NO.26AS, RELATING TO FINANCIAL YEAR 2012 13, THE RECEIPT FROM SOCIEDAD E HAS BEEN SHOWN AT ` 5,67,13,320. THUS, PRIMA FACIE, THE CLAIM OF THE ASSESSEE THAT THE ACTUAL AMOUNT RECEIVED FROM SOCIEDADE DURING THE YEAR UNDER CONSIDERATION IS ` 5,67,13,320, APPEARS TO BE CORRECT. THEREFORE, WE DIRECT THE ASSESSING OFFICER TO VERIFY THE RECEIPT IN THE NEW FORM NO.26AS ISSUED FOR THE FINANCIAL YEAR 2012 13, A COPY OF WHICH HAS BEEN SUBMITTED BEFORE US , AND RESTRICT THE ADDITION ON ACCOUNT OF CONTRACT RECEIPT FROM SOCIEDADE TO THE AMOUNT SHOWN IN NEW FORM NO.26A S . GROUNDS RAISED ARE PA RTLY ALLOWED . 7 . IN THE R ESULT, APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15.04.2019 SD/ - MANOJ KUMAR AGGARWAL ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 15.04.2019 6 CGU LOGISTICS LTD. COPY OF THE ORDER FORWARDED TO : ( 1 ) THE ASSESSEE; ( 2 ) THE REVENUE; ( 3 ) THE CIT(A); ( 4 ) THE CIT, MUMBAI CITY CONCERNED; ( 5 ) THE DR, ITAT, MUMBAI; ( 6 ) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY (SR. PRIVATE SECRETARY) ITAT, MUMBAI